On 13th of June 2023, Haru Invest has announced that all withdrawal operations in the platform are to be suspended indefinitely.
This is a small YouTube video, which I have made upon requests by many people to comment on the situation with Haru Invest.
Additionally, for investors who wonder how the situation might play out from this point, belowelow is a legal opinion provided by a Swiss law firm on possible outcomes:
Under South Korean law, the possibility to assert jurisdiction over a foreign corporation is decided by corporation's activities within the borders of South Korea (and interactions with its citizens) and the relationship between the foreign corporation and the South Korean subsidiary entity.
A more detailed review:
I. Relationship between parent and subsidiary companies:
The legal relationship between Haru Invest Korea Ltd. (based in South Korea) and its parent corporation BCHaru Pte. (registered in Singapore) would be central in determining whether the South Korean court can assert jurisdiction over the parent company.
CASE 1: Separate Legal Entities
If Haru Invest Korea Ltd. and its parent company operated as completely separate legal entities, and the parent company (BCHaru Pte.) does not have significant activities or presence in South Korea, it may be challenging to bring the parent company under the jurisdiction of the South Korean court.
CASE 2: Connection to South Korea
If the parent company has significant connections to South Korea, such as conducting business directly within the country, having assets or bank accounts there, or other meaningful ties, the South Korean courts may assert jurisdiction over the parent company.
II. “Piercing the Corporate Veil” doctrine:
However, if there is evidence that the parent company BCHaru Pte. has exercised substantial control over Haru Invest Korea Ltd., commingled assets, or otherwise disregarded the separate legal status of Haru Invest Korea Ltd., the South Korean courts might consider the "piercing the corporate veil" doctrine. This legal doctrine allows courts to ignore the separate legal status of related entities under certain circumstances, such as fraud or misconduct.
III. International Agreements and Treaties:
The existence of any international agreements or treaties between South Korea and Singapore could also influence the court's ability to assert jurisdiction over the parent company. These treaties must be further studied during an entirely separate legal consultation package.
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